Apple’s fine post-Jobs, but what’s next?

Commentary: CEO Tim Cook has put a stamp on the company

This update corrects the title for Santa Clara University’s Stephen Diamond.

SAN FRANCISCO (MarketWatch) — Apple Inc. has done just fine, even thrived, without its co-founder Steve Jobs.

Just one year after the death of the former Apple
AAPL, -0.45%
chief executive, the company and its current chief Tim Cook have continued on with the mission of its legendary — and sometimes prickly — leader. Apple has launched a new iPhone, another iPad, revamped the iPod and upgraded its core operating systems, to name some of its important new products.

If you are an investor, you have seen Apple’s stock climb a stunning 80% in the past year, or about $295 a share, to become the most valuable company in the world. The product lineup that Jobs and his top engineers and designers developed still bears fruit, and is expected to do so for many years to come.

But the question on the minds of some investors is what will Apple come up with next, be it five or 10 years down the road. What is its next act, after it turned industries like publishing, music and even personal computing upside down? And is Cook the right leader to find and cultivate innovation within the company?

Wall Street and investors in general love him, even after last week’s flap and Cook’s unusual apology over Apple’s faulty Maps software in iOS 6, which replaced Google’s maps. Based on the fact that all of Apple’s executive team have stayed on, it would appear that employees love him too. Read how in Apple-Google maps war, consumers lose.

“I think his main task frankly with Apple here is to keep people motivated, keeping them focused, and so far he has done a great job,” Shaw Wu, an analyst with Sterne Agee, said in an interview. “Steve was obviously very important, but it’s not about one person, it’s about the whole company, the staff rolling in the right direction and staying hungry. Companies start failing when people get lazy, and that’s not the case here, they are still very motivated.”

Others argue, however, that the maps fracas may demonstrate that Cook might not have been focused enough on the customer experience as Jobs had been. A debate has ensued, at least in the media, over what Jobs would have done, whether he would have released the imperfect maps application. Jobs, however, would be furious about this debate. Before he died, he made it clear to Cook that he did not want anyone at Apple constantly second-guessing and wondering, “What would Steve do?” Read AllThingsD interview with Apple board member Al Gore.

In his apology to consumers, Cook said: “At Apple, we strive to make world-class products that deliver the best experience possible to our customers. With the launch of our new Maps last week, we fell short on this commitment.” Read more about Cook’s apology.

Stephen Diamond, associate professor of law at Santa Clara University on securities law and corporate governance, said that Cook’s talents are in operations. “He makes the trains run on time,” Diamond added, noting that he isn’t sure Cook has the same eye toward innovation or the consumer experience of his predecessor.

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Apple’s next
big act While Apple has thrived in the past year, the big
question remains: What is its next act?

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CEO of the decade
Slide show from December 2010 when Jobs was named MarketWatch’s CEO of
the Decade.

What else might Jobs have done to put his stamp on history?
MarketWatch's Jon Friedman discusses on The News Hub

“Does this signal that Tim Cook does not get it?” Diamond asked of the maps flap. “Someone forgot that the customer experience is why people stand in line for days.”

Of course, no one has expected anyone to be able to replace Jobs and his amazing intuition, sense of timing and ability to figure out what consumers want. “Steve was like lightning in a bottle,” according to Diamond.

Cook has made some changes to put his own stamp on the company, with one of the biggest being the decision to begin paying a dividend to investors — a move the more frugal-minded Jobs might have abhorred. Other adjustments have been smaller and less noticeable from the outside, such as making Apple a better place to work. Cook initiated a philanthropic matching program and rewarded employees with a week off after Thanksgiving.

But as far as invention, Apple’s current product lineup was developed under Jobs. Indeed, some of these inventions could carry on for years. The Macintosh, for example, which has totally evolved into the thin, light MacBook Air, debuted in 1984. “Each of these inventions lasts a long time,” Wu commented.

One innovation that Jobs talked about to his biographer, author Walter Isaacson, though, has yet to emerge from the drawing board, or from the engineering benches in Cupertino, Calif.

“I’d like to create an integrated television set that is completely easy to use,” Jobs told Isaacson, according to his book “Steve Jobs.” “It would be seamlessly synced with all your devices and with iCloud. … It will have the simplest user interface you could imagine. I finally cracked it.”

Yet so far, the only TV Cook has talked about is the existing Apple TV. The Wall Street Journal reported in mid-August that the company was in talks with some of the biggest cable operators about using an Apple device as the set-top box for live TV and other content, but still no deals with any of the cable giants have emerged. Read Wall Street Journal article.

Wu pointed out that cable operators are not yet under siege from the slow-moving trend of cord-cutting. In contrast, the music industry was under a far bigger threat from piracy and was more open to having conversations with Jobs about the iTunes music store when it was in development. “The cable business isn’t quite down that road yet,” he said.

Some investors, though, might be worried about what Apple can come up with after the iPhone and the iPad, beneath the surface of its stunning sales growth, record financial results and soaring stock price.

Others are just enjoying the prosperity while they can, or are confident that Jobs’s handpicked team, which includes well-regarded executives such as industrial-design guru Jonathan Ive, and Scott Forstall, who heads up mobile software, will develop the next insanely great thing.

But the big question remains. Many years down the road, without that lightning in a bottle providing insight and intuition, what will be Apple’s next act?

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